Couriers working for online food delivery group Deliveroo are company employees not just freelancers, a Madrid court ruled on Tuesday.
This means that workers will now be able to ask Deliveroo for a formal contract and corresponding benefits.
Couriers working for food delivery companies such as Deliveroo often don't receive full employment benefits as a set wage, social security, or insurance under current contracts in Spain.
Critics claimed these type of contracts often lead to exploitation and leave workers vulnerable as they are paid by delivery, which Deliveroo countered by saying this type of agreement gave workers more flexibility.
The court said couriers were not freelancers because they needed to follow specific instructions and lacked the autonomy usually given to independent contractors.
Bernardo Garcia, a lawyer with one of Spain's leading trade unions, Union General de Trabajadores (UGT), explained to Euronews the importance of the sentence: "The process is very special because it started at the request of the General Treasury of Social Security," adding this is the first collective sentence with 500 affected people and was carried out thanks to the "exhaustive action" of the labour inspectorate.
The online food delivery service said it would appeal the court ruling.
"Deliveroo believes that this sentence does not reflect the way couriers collaborate with the company, and as such we will appeal this ruling," the company said in a statement.
But Garcia said there is proof there is a "voluntary work relationship that is remunerated by Deliveroo and that additionally, the final product belonged to the company and not the worker."
Since there is an existing work relationship, the status of employee applies to the "riders," making them available to receive social security, said Garcia, adding that if they were dismissed they would have the right to claim compensation for dismissal.
Even drivers who no longer work for the company could ask for repayment for their contributions to the social security system as self-employed.
There are an estimated 1,500 Deliveroo couriers in Spain.
The court's sentence could also affect other food delivery companies such as Glovo and Uber Eats.
In April, the European Parliament approved a set of minimum rights for people working for digital businesses such as Deliveroo or Uber, including compensations for cancelled assignments and the right to work for more than one company, which EU countries will have three years to put into place.
However, Garcia believes this sort of work should not be regulated at the European level since it would be more effective to regulate them at the national level.
The lawyer believes that European regulations for those working with digital platforms would create a third unspecified type of worker and insisted that this type of work relations, though new and modern, is still a traditional work relationship.